When Germans refer to a “black zero” these days they mean a balanced fiscal budget with no red ink. What a concept. If it weren’t so unthinkable (I am from US-Amerika and we’re clearly too smart for that) I would have a “quasi-religious fixation” with it, too. More power to you, Wolfgang.

In his aversion to the pursuit of full employment through fiscal policy, Mr Schäuble is an obvious heir to Eucken. This is also true of prominent German economists who, during the eurozone crisis, have ignored the effects of austerity on demand, out of a deep-seated belief that structural reforms can solve all problems.

Despite bitter opposition in many quarters to the austerity-first policies Germany has imposed on Europe’s poorer nations, Chancellor Angela Merkel’s government has hung on to its role as champion of integration on the Continent through deft use of diplomacy and the country’s economic clout.

But in negotiating a new deal this week to bail out Greece, Germany displayed what many Europeans saw as a harder, more selfish edge, demanding painful measures from Athens and resisting any firm commitment to granting Greece relief from its crippling debt. And that perception was fueled on Thursday when the German finance minister, Wolfgang Schäuble, suggested that Greece would get its best shot at a substantial cut in its debt only if it was willing to give up membership in the European common currency (they mean Grexit here, of course, they just don’t like to use the word).

Well known for his refreshing viewpoints, Mr. ex-SPD, ex-Left, ex-Bolshevist, ex-you-name-it Oskar Lafontaine himself has come up with a brilliant new idea to save Greece from its upcoming euro Grexit exit: Get rid of the euro first.

Being the true radical thinker that he is, he seems to have devised a radical new European economic system by which goods or services are directly exchanged for other goods or services without having to use a medium of exchange like dirty, filthy, old (or in his case new) money. And the way things look right now, Greece will be the first country to get the chance to test this out in a big way.

The price of electricity for private households in Germany has gone up 38 percent since 2008.

It’s easy to do, all you other countries out there. Just follow Germany’s example and shut down all of your nuclear power plants in a panic and then force through the construction of renewable wind and solar energy plants that are neither energy nor cost-efficient enough and then have them heavily subsidized by these households. That turns things around in no time.

PS: The belief that labor unions can substantially raise real wages over the long run and for the whole working population is one of the great delusions of the present age. This delusion is mainly the result of failure to recognize that wages are basically determined by labor productivity

But… How is it that its critics blame Germany for the high unemployment, declining living standards, and riots to their South?

If this were a football game, the referee should call unnecessary roughness for piling on Germany. The American Left led by Paul Krugman (The Harm Germany Does and Those Depressing Germans) excoriates Germany for forcing austerity on the rest of Europe. The U.S. Treasury – and others – (no newcomer to spending) demands that miserly Germany spend more to pull the PIIGS (Portugal, Italy, Ireland, Greece and Spain) out of their economic doldrums…

I interpret the liberals’ German bashing as having an entirely different motivation – their inherent dislike of economic success… In the liberal mind set, success must be equally shared. If one person, company, or country is better off, it must be at the expense of those who are less well off. We need to even things out in their zero-sum world.

PS: And I’m going to go even further out on the limb tonight defending Germany by predicting that they will finally – after 19 encounters? – beat Italy.

It goes a little like this: In the year 2035, 2035 (if man is still alive), all the economies of Welt will have lost ground big time except for China and India (and a wee little bit for Brasil and Russia) and Germany will have become so weak and mickrig (puny) that it will then become prey to something economic scientists and other experts refer to here as “langsame Bedeutungsverlust” or a creeping loss of significance.

Hey, ain’t that how life goes for all of us out there sooner or later, Deutschland? Don’t fret. You are not alone. You are just all by yourself.

Money is like water (or maybe like beer). It has to go somewhere. And 40 billion euros just made its way to Germany.

While fear has driven money away from Greece and Spain and co, making the government cost of repaying debt in these countries seem prohibitive, in Germany it has been quite different. Fear has boosted Germany coffers…

One thing is for sure, putting it in Greek bonds is risky. Spanish, Italian and Portuguese bonds don’t seem much safer either. But German bonds, in contrast, feel as safe as a safe house in a land with no crime. In fact so safe are German government bonds or bunds, perceived to be, that there have been times when the yields on some of them have been negative.

So actually, Germany has done rather well out of fear created by the euro crisis – or should that be the other way around – a euro crisis created by fear?

Verblüffender Befund (an amazing finding)? I don’t see how it could amaze anyone here – anyone who has ever gone shopping in Germany and then compared those prices to those you would pay in other European countries, that is.

Germans apparently aren’t aware of the fact that they have some of the lowest Lebenshaltungskosten (living costs or cost of living) in all of Europe. Of their immediate neighbors, it’s only cheaper to live in Poland and Czechia.

What is really amazing I find, however, is the fact that the Germans are able to enjoy these cheap prices while still having a higher per capita GDP than a lot of the European countries with a higher cost of living (Belgium, Denmark, France).

The state is that great fiction by which everyone tries to live at the expense of everyone else.
- Frederic Bastiat

The problem with socialism is that you eventually run out of other people's money.
- Margaret Thatcher

The whole aim of practical politics is to keep the populace alarmed — and hence clamorous to be led to safety — by menacing it with an endless series of hobgoblins, all of them imaginary.
- H.L. Mencken

It is like information theory; it is noise posing as signal so you do not even recognize it as noise. The intelligence agencies call it disinformation. If you can float enough disinformation into circulation you will totally abolish everyone's contact with reality, probably your own included.
- Philip K. Dick

Ninety percent of the politicians give the other ten percent a bad reputation.
- Henry Kissinger

Hegel, installed from above, by the powers that be, as the certified Great Philosopher, was a flat-headed, insipid, nauseating, illiterate charlatan, who reached the pinnacle of audacity in scribbling together and dishing up the craziest mystifying nonsense. This nonsense has been noisily proclaimed as immortal wisdom by mercenary followers and readily accepted as such by all fools, who joined into as perfect a chorus of admiration as had ever been heard before. The extensive field of spiritual influence with which Hegel was furnished by those in power has enabled him to achieve the intellectual corruption of a whole generation.
- Arthur Schopenhauer

German schadenfreude knows no bounds, particularly when it comes to the United States. The country loves to feel superior to a superpower like America. Yet Germany also harbors a childish infatuation with Obama — one which has little political grounding. The reasons are psychological. …The criticism of America has always been a bit infantile. One is familiar with the theory from psychoanalysis, when people talk about transference, or when suppressed feelings or emotions are overcome by projecting them onto others. It may work for a while, improving one’s feeling of self-worth by devaluing an imagined adversary. But it always falls short. Which is why the ritual must be constantly carried out anew.
- Jan Fleischhauer

Intellectuals, in the words of the writer Eric Hoffer, "cannot operate at room temperature." They are excited by daring opinions, clever theories, sweeping ideologies, and utopian visions of the kind that caused so much trouble during the 20th century. The kind of reason that expands moral sensibilities comes not from grand intellectual "systems" but from the exercise of logic, clarity, objectivity, and proportionality.
- Steven Pinker

The difference between Greek pessimism and the oriental and modern variety is that the Greeks had not made the discovery that the pathetic mood may be idealized, and figure as a higher form of sensibility. Their spirit was still too essentially masculine for pessimism to be elaborated or lengthily dwelt on in their classic literature... The discovery that the enduring emphasis, so far as this world goes, may be laid on its pain and failure, was reserved for races more complex, and (so to speak) more feminine than the Hellenes had attained to being in the classic period.
- William James

A doctrine must not be understood, but has rather to be believed in. We can be absolutely certain only about things we do not understand. A doctrine that is understood is shorn of its strength. Once we understand a thing, it is as if it had originated in us. And, clearly, those who are asked to renounce the self and sacrifice it cannot see eternal certitude in anything which originates in that self.
- Eric Hoffer

It is unrealistic to expect people to see you as you see yourself. If people reach conclusions based on false impressions, they are the ones hurt rather than you, because it is they who are misguided. When someone interprets a true proposition as a false one, the proposition itself isn't hurt; only the person who holds the wrong view is deceived, and thus damaged. Once you clearly understand this, you will be less likely to feel affronted by others, even if they revile you. You can say to yourself, "It seemed so to that person, but that is only his impression."

Archives

Archives

Email Subscription

Enter your email address to subscribe to Observing Hermann and receive notifications of new posts by email.